Auditing Principles and Corporate Governance in the Australian Royal Commission Context

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AUDITING PRINCIPLES ASSESSMENTS.
AUSTRALIAN ROYAL COMMISISON CONTEXT.
NAME OF STUDENT:
NAME OF INSTIITUTION:

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AUDITING PRINCIPLES ASSESSMENTS.
Brief introduction.
The Australian Royal commission was initially launched at a federal level under the royal
commission's Act in 1902 (Hutchens, 2018). The commission is mandated to investigate
misconduct by the Australian bank and other financial services entities. In case of any criminal
acts from their investigations, the commission is required to approve legal proceedings to the
tribunal for disciplinary. According to Hutchens, (2018) the commission is a public inquiry just
like in the United Kingdom, Canada and New Zealand formed to look into fishy financial issues
which are considered of public importance (Hutchens, 2018). In this analysis, we are going to
discuss the recent 2018 Australian royal commission against the misconduct of the financial
sector. According to Braddon & Hooper, 2018) through the existence of the commission, the
general public is able to understand the misconduct in the banking industries and the efficiency
of the sector in the Australian market. Further, the commission is fully mandated to investigate
on banks financial cruel behaviors that appear to contravene with the banking regulations
(Hutchens, 2018).
Part A.
Corporate governance in business.
According to Gericke, (2018) corporate governance in the public institutions is the
processes by which the corporations are controlled with a clear distribution of duties among the
different corporate participants. In the corporate governances the organization's objectives are
well pursued in a regulatory, social and good environmental context (Gericke, 2018). Corporates
governance involves balancing the too many organization's shareholders/stakeholders,
management and community interests. Further, good corporate governance is an ideal section of

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AUDITING PRINCIPLES ASSESSMENTS.
any business not only in the financial services sector. The ability of the corporations to manage
risks ultimately follows the st century board of directors are responsible for the appropriate
governance of the organizations they are overseeing. Corporate practices set by corporate
governance’s participant such as auditors, directors, and regulators. In a corporate governance,
the risk appetite and organizations culture will determine how such organizations will respond to
the rules and regulations set by the regulator such as the Australian royal commission (Gericke,
2018)
Importance of corporate governance.
Corporate governance ensures a positive impact on the company’s share price.
Corporate governance lowers the cost of capital of the organization.
In an environment with strong corporate governance, they are improved shareholders confidence.
Corporate governance ensures overall economic growth.
Improved corporate governance brings the organizations success
In Gericke, (2018) the success of the business depends on the intake of overall corporate
governance, weak corporate governance, especially in the financial sector, can result in failure of
risk management tactics which eventually can affect the entire financial system in the economy.
In case for instance the Australian financial institution boards of management lacks the well
understanding of the broader risks faced by the financial market in a current year, though an
absence of the robust corporate governances frameworks, a severe financial breakdown can be
caused which can even affect the share value of the institution in the market (Gericke, 2018).
The objectives of corporate governance.

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AUDITING PRINCIPLES ASSESSMENTS.
Corporate governance ensures the shareholder's wealth is increased.
Through corporate governance, the institution is able to lay down good transparency.
Through corporate governance, they are clear accountability in the firm.
An organization is able to do self-evolution through comparison in corporate governance.
Through corporate governance, firms are able to offer full disclosure.
It’s only through corporate governance equitable treatment of shareholders is embraced
(Meredith “et al” 2012).
The overall purpose of the Royal Commission.
Overall investigation of banks. The royal commission is mandated to investigate the
Australian banks on alleged misconduct. According to the Hutchens, (2018) two Australian
bank’s that is AMP and Commonwealth were investigated for client’s related offenses. The
Commonwealth bank management openly admitted to having been charging fees to clients’
accounts who have already died. On the other hand, the AMP bank admitted to having been lying
the regulator on its findings (Hutchens, 2018).
The commission is also mandated to investigate on banks financial behaviors that appear
to contravene with the banking regulations. Such behaviors include failure by the banking
lenders to verify customers living expenses before disbursing loans unto them. Bribery
allegations by the banking sector have also been a major issue since the inception of the royal
commission. In this cases, the Royal Commission is directed to fine where appropriate and
compensate the victims (Chau & Clark, 2018).